While it will mean we will be able to now sell physical products through Clickbank, I have a sneaky suspicion that only select vendors will be able to use this feature (probably those that have made over a certain dollar value of sales through Clickbank already).

I think it is one of the better ways to do it. I have a similar type of launch coming up and that is the way I am setting it up using Clickbank. You definitely want to use Clickbank for your front end if you can because of the affiliate opportunities it opens up for you.

This similar type of model is the one I have also noticed Ryan Deiss using for a few of his products. If you're not familiar with Ryan Deiss he is a fanatical split tester, so if he using one type of model then you can be sure he has tested other setups and that this one has resulted in the most overall profit for him.

I am actually a member of Ryans 'Total Access Club' and inside they did a video series on this exact thing. They walked through and showed us all the results from the split testing of their order processes. They tested different price points for the front end offer, $27, $47 and $97. After some decent traffic they found out that having the front end offer priced at just $27 actually resulted in the biggest overall profit - front end and back end sales included.

My theory is that when someone comes in your door at such a low price point as $27, not only are they more likely to join your sales funnel because its priced so low, but when they are then presented with the one time offers, they are more likely to buy because they have only spent $27 on the initial product - so they feel like they have more money to burn.

If you wanted to, you could signup for one of his products over at:
http://www.getmoneyfromgoogle.com. The front end product only costs $27 I think so you could buy it just to see how his whole upsell process works - it's also not a bad course as well.

They don't use Clickbank for their front end product but for guys like us just starting out, it is a much simpler process if we use Clickbank. People like Ryan have an advantage in that they already have big name people ready to promote their products so they don't need to rely on places like Clickbank to find new affiliates.

Hope it all goes well.

Will

That is excellent advise! I believe I will give that set-up a shot and see how it works out.

-Presto

FYI - Yes, you can only set one affiliate percentage per Clickbank account. So if you wanted to offer a different product with a different percentage then all you need to do is get another Clickbank account.

Also, I'm not sure why in your example above, you are saying you would pay your affiliates 75% of the sale? If it's a small ticket item ($17-$67) then you would want to offer something high like that so affiliates have some money to advertise with, etc, however if you are selling a higher ticket item like yours, something like 40-50% would be fine.

From all the information you have given above, here is how I would set it up for maximum profit. Sell a digital version of your product for around $27-$37. Offer affiliates around 75% of each sale.

Once a person has purchased and you send them to the members area to download, present them with a one time offer of the physical version of the course including the instrument. If they say no thanks then offer them the physical version without the instrument for a little cheaper. If they say no thanks again then take them straight to their download and maybe follow up with them with the physical version again in a week or 2 - after they have had a time to read the digital version.

Your main objective should be to get people through the door and into your sales funnel. People are a lot more likely to take a chance when it is only $27 compared to $138. Anyone who is going to pay $138 for your physical course is definitely going to pay $27-$37 for your digital version. So let them do this first, they can see your whole payment process is secure and that they got exactly what you told them they would. Now that you have gained a bit if trust you can stick your more expensive item infront of their face.

Obviously you won't be able to use Clickbank just yet to sell the physical version. I would just set that up with someone like Paypal or 2checkout.com.

Hello,

Thank you for contacting ClickBank.

Currently, ClickBank does not handle the sale of physical items; we handle transactions for digitally deliverable (downloadable) products only. However, ClickBank is planning on being able to sell physical products in the Fall of this year.

There are a few ClickBank clients participating in a beta test for physical products. However, we are no longer accepting participants.

Please let me know if I can assist you further.

Shelly
Senior Account Representative
srs@clickbank.com

I am in the process of setting up my first info product in clickbank.

I have come across this article because it is exactly the issue I am having with setting up my information product to be sold along with a physical product.

To me it comes down to a numbers game.

The information product is made to be sold with a physical instrument. I cannot pay out the affiliates a percentage of the selling price for the physical instrument, as I would lose money on the deal. Here is an example of what I mean:

Costs for physical products:

Physical Instrument Cost:$21.00
Cost to print CDs, DVDs, and manuals: ~$15

Total costs are about $36. Before shipping.

I sell this package for $138.00 (including the info product)

Okay, now for the issue.

Clickbank makes you keep a constant sales percentage for all of your products. I would like to maximize this percentage in order to attract the most affiliates.

The max percentage is 75%.

Now, lets do the math.

Final selling price of $138.00 sent by an affiliate making 75% commission give the affiliate a take of $103.50.

Wow... That leaves me with $34.50.
The cost to produce those items before shipping is about $36. I lose out completely.

Great for the affiliate!

Any ideas?!?

Here is a solution that I have come up with in order to make it more fair for everyone.

Sell only the info product through clickbank, and then on the thank you page offer them the instrument and any other associated physical products.

This is not the optimal set-up, I would rather sell the entire package with all the options and assign various commission percentages to each package.

Long-story, but I am hoping that this will help me to find a new result. Thanks,

-presto

There isn't too much you can do about refunds if you are going to offer them. Obviously you could ask them to send the physical product back in order to get the refund - this would deter most people from taking the refund option because they then have to re-package it up and pay the postage back to you.

However if done properly, your physical products should have a much lower refund rate than that of your digital products, just because it takes more effort on their part to send the physical product back.

My advice to you is to just accept that refunds are a part of any business, however good or bad your products may be. There will always be someone who wants to get something for nothing and will ask for a refund.

As long as you provide a good product then the amount of refunds you get will be minimal and the profit made will far exceed any costs lost with refunds.

Just my thoughts.

All the best,

Will